Indonesia’s Preparedness to Ratify the United Nations Convention on Contracts for the International Sale of Goods (CISG)

Abstract

Integrated international trade requires legal certainty that reduces transaction costs and mitigates disputes across jurisdictions. Although most of Indonesia’s major trading partners have ratified the United Nations Convention on Contracts for the International Sale of Goods (CISG), Indonesia remains a non‑Contracting State. This situation often forces domestic parties to accept foreign governing laws or international arbitration, resulting in legal uncertainty and higher transaction costs. The present study analyses regulatory gaps between Indonesian commercial contract law (including the Civil Code, Commercial Code and Trade Law No. 7 of 2014) and the CISG, evaluates the practical implications of non‑ratification, and formulates pragmatic strategies for harmonisation. Employing normative legal analysis and comparative policy review, the paper recommends staged harmonisation involving targeted legislative updates, model transitional contract clauses and capacity‑building for institutions and market participants. These measures aim to strengthen legal certainty and enhance Indonesia’s competitiveness in cross‑border trade.

Keywords: CISG; international contract law; legal harmonisation; legal certainty; international trade; Indonesia.